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[LONDON] Oil rose above US$60 (S$81) a barrel on Friday for the first time this year, bringing its gain this week to almost 4 per cent, supported by signs that deeper industry spending cuts may curb excess supply.
Also supporting oil, growth in Germany's gross domestic product beat expectations, as did plans for a meeting between Greek officials and creditors. Euro zone GDP data is due later on Friday.
The price of Brent crude collapsed from US$115 in June to US$45.19, the lowest in almost six years, in January due to oversupply. Since January, mounting signs of lower industry spending have helped prices move higher.
Apache Corp, a top U.S. shale oil producer, said on Thursday it would cut capital spending and its rig count in 2015 following the price collapse, keeping its output growth mostly flat.
Brent for April delivery was up 76 cents at US$60.04 by 0917 GMT, after briefly gaining more than US$1. The March contract expired overnight. U.S. crude was up 61 cents at US$51.82. "During the last weeks, crude oil rebounded driven by improved market sentiment and by expectations that low prices will lead to lower supply growth in 2015," said Daniela Corsini, analyst at Intesa Sanpaolo, in a report.
Besides Apache's update, Royal Dutch Shell's chief executive said on Thursday supply might not be able to keep up with growing demand as companies reduce budgets, and France's Total announced investment and job cuts.
Still, analysts at JBC Energy in Vienna pointed out in reference to Apache's moves that spending cuts can easily be reversed. "While the company expects North American onshore production to be flat this year, they emphasise their flexibility to come back very quickly if the price environment or the cost structure changes sufficiently," JBC said. "This is generally what makes most people doubt that the latest rally can be sustained." A weaker U.S. dollar, which makes dollar-denominated commodities cheaper for holders of other currencies, has also supported oil this week, analysts say.